HQ 225150: Request for information concerning the requirements for duty-free entry of merchandise under Harmonized Tariff Schedule of theUnited States Annotated (HTSUSA) subheading 9813.00.30; 19 CFR10.37; Customs ruling HQ 224496 (January 11, 1994).

Native CBP ruling rendition. Applicability is fact-specific; modification/revocation relationships and original publisher date are retained. Publisher sentinel year0001 means unknown date, not a historical legal adoption.

                            HQ 225150

                         February 2, 1994


CON-9-09 CO:R:C:E 225150  TLS

CATEGORY: Entry

Mr. Gary J. Conte
Aceto Corporation
One Hollow Lane 
Lake Success, New York  11042-1215


RE: Request for information concerning the requirements for duty-free entry of merchandise under Harmonized Tariff Schedule of the
United States Annotated (HTSUSA) subheading 9813.00.30; 19 CFR
10.37; Customs ruling HQ 224496 (January 11, 1994).


Dear Mr. Conte:

     This office has received the above-referenced request for a
information as provided for under Customs regulations.  We have
considered the request and have the following comments in
response.

FACTS:

     Your company plans to import 5-Mesylamino Indole-2-carboxylic acid (MACA) for exclusive sale to another company. 
MACA is to used to produce a drug which is currently under
clinical trial investigation.  You would like to know what the
requirements are if this article is to be imported under HTSUSA
subheading 9813.00.30.

ISSUE:

     Whether the product to be imported in this case qualifies
for admission under HTSUSA subheading 9813.00.30.

LAW AND ANALYSIS:

     Subheading 9813.00.30 provides for the following:

     Articles intended solely for testing, experimental or
     review purposes, including specifications, photographs
     and similar articles for use in connection with
     experiments or for study...

The rate of duty for articles entered under subheading 9813.00.30
is "[f]ree, under bond, as prescribed in U.S. Note 1 to this
subchapter."  The relevant part of U.S. Note 1(a) of the
subchapter this subheading is found under (Subchapter XIII) reads
as follows:

     The articles described in the provisions of this
     subchapter, when not imported for sale or for sale on
     approval, may be admitted into the United States
     without the payment of duty, under bond for their
     exportation within 1 year from the date of
     importation...  (Emphasis added.)

The length of time the imported product may remain in the United
States under bond may be extended for two additional years, one
year at a time, for a maximum period of three years.  19 CFR
10.37.  U.S. Note 3 provides that "[u]pon satisfactory proof that
any article admitted under heading 9813.00.30 has been destroyed
because of its use for any purpose provided therein, the
obligation under the bond to export such article shall be treated
as satisfied."

     To summarize what is required for an article to be admitted
under 9813.00.30, the article must 1) be intended solely for
testing, experimental, or review purposes; 2) not be imported for
sale or for sale on approval; 3) and exported (or destroyed)
under bond within one year from the date of importation, unless
the period under which the article may remain in this country
under bond is extended.

     From the information you have furnished us, we find that
your proposed transaction would not meet the requirements for
articles admitted under subheading 9813.00.30.  The first
requirement, intention to test or experiment with the article,
seems not to be met here.  The use of MACA in the production of
another drug that is to be experimented with is not a testing or
review of the imported article contemplated under 9813.00.30. 
See, e.g., Customs ruling HQ 224496 (January 11, 1994).  The
third requirement, exportation or destruction under bond within
the authorized bond period, remains to be fulfilled after the
article has been admitted for testing.

     The second requirement, not imported for sale, is also not
being met in the present proposed transaction.  Your company
plans to sell the imported article to another company.  You have
noted that the sale is exclusive to the other company and your
company will not profit from the sale.  These facts are
irrelevant to the basic requirement of not importing for sale. 
Whether or not the importer makes a profit on the sale is of no
consequence here and neither is the exclusivity of the sale. 
Therefore, we are compelled to find that the proposed importation
of MACA for sale to another company would not be eligible for
admission under subheading 9813.00.30.

HOLDING:

     The article to be imported in this case will not be eligible
for admission under HTSUSA subheading 9813.00.30 because it is to
be imported for sale in violation of U.S. Note 1(a) of Subchapter
XIII, HTSUSA, and because the imported article itself will not be
tested.

                    Sincerely,




                    John Durant, Director
                    Commercial Rulings Division